At Ahmedabad-Based Fountainhead, a little-known coaching academy for chartered accountants, February 20 was a day of celebration. The two-year-old chartered accountants’ training institute was playing host to a recruiting team from global consulting firm Ernst & Young (E&Y), rated among the world’s top four.
At the end of the day, the institute, a unit of Anagram Knowledge Academy, run by the Lalbhai family, promoters of textile giant Arvind, accomplished something its peers would hardly have aspired for five years ago — it got 11 of its students placed with the consulting firm.
Corporates, including international audit and consulting firms like E&Y, KPMG and PWC, are looking beyond placement through apex professional body Institute of Chartered Accountants of India (ICAI) and directly approaching training institutes in smaller cities to save on costs and meet the growing requirement for CAs in a recovering economy.
While E&Y is expecting to recruit 70-80 fresh CAs this year, KPMG plans to add a 100 professionals. “We go to such institutes as we get readymade, well-groomed candidates who have undergone focused training. We have a comfort level with these institutes and look forward to a long-term relationship with them,” says associate director-HR, E&Y Joydeep Roy.
Many of these institutes started the recruitment process soon after the announcement of CA results on January 15, while ICAI began recruitments from March 4, through its 15 campuses. E&Y and PWC have been visiting coaching classes in Jaipur, Indore and Chandigarh for the past two years. Ahmedabad is the latest addition in their hiring itinerary.
Jaipur, India’s largest centre for CA training, contributes 10-12% of the total number of chartered accountants every year. Vidhya Sagar Career Institute in Jaipur saw E&Y hiring 25 CAs this January. PwC too picked up 50 candidates from the institute last month, says its chairman Ramesh C Sharma.
Indore is catching up with Jaipur. Dubai-based Saraf Shipping has for the first time approached Nahata Professional Academy, a leading brand in the field of CA coaching in central India. The company plans to hire from ICAI campuses later. Nahata Academy, which produced 35 CAs this year, saw substantial interest among recruiters. In the past two years, PWC, KPMG and Deloitte have recruited CAs from the academy, according to Deepak Mulchandani, co-coordinator for campus recruitment at the academy.
Costs play a huge role in companies going directly to training academies. ICAI, which plays a facilitator in recruitments, invites companies and charges them around Rs 1.5 lakh. Moreover, apart from making recruiters adhere to norms aimed at safeguarding candidates’ careers, ICAI expects companies to pay a minimum salary of Rs 3 lakh.
The institutes, on the other hand, do not charge recruiters and welcome them with no strings attached, as star recruiters help build their brands.
“Placement interviews by a company like E&Y are an endorsement of our commitment. We focus not only on preparing students for success in CA exams, but also mentor them and ensure that they are well-placed in their professional career,” says Ahmedabad-based Knowledge Academy director Milan Shah.
Another important factor that recruiters consider is salary levels, and they save on costs by hiring from smaller towns. “If we pay Rs 6 lakh-plus-bonus in Mumbai, we offer Rs 5.5-lakh-plus bonus in Delhi. Other centres provide us an arbitrage opportunity as far as hiring costs go,” says a senior official at one of the leading recruiters, who did not wish to be named.
E&Y, for instance, paid an average salary of Rs 4.25 lakh for an associate executive in Ahmedabad. After the six-month probation, his salary will go up to Rs 5.5 lakh as per the company’s pay hike policy and the candidate’s performance, says a company official who did not wish to be named.
With economic growth slated to reach 8%-plus levels this year, the demand for chartered accountants is expected to see a 50% rise. ICAI hopes to place 3,000 CAs, up from 2,000 graduates last year, says chairman of the Committee for Members in Industry Subodh Agrawal.
With such a surge in demand, candidates are getting choosy. According to sources, a large corporate evinced interest in hiring 40 CAs from an ICAI campus this year. The company shortlisted 150 candidates, but only 15 were interested in joining the corporate giant. The others wanted to explore their own options.
Since Independence, India has produced just about 1.5 lakh CAs, and the professionals have always been in short supply.
According to Mr Agarwal, the apex body has already received a demand for 1,500 fresh graduates. ICAI holds its exam twice a year, and nearly 7,000 students clear it every year. Close to 20% candidates get jobs either through ICAI, while the remaining find their own way into the job market.
ICAI plans to raise its placement numbers by another 20%. This year, it has been approached by 72 companies for recruitment. These include Morgan Stanley, SBI, Bank of India, ICICI Bank, Wipro, L&T, ITC, Nestle, GMR group, NMDC, UTI AMC, Vedanta etc. Leading consultancies normally visit ICAI campuses at Mumbai, Delhi, Bangalore, Chennai and mini-metros like Pune for their requirements.